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Airdrops: Tips for Supporting the Right Projects

March 12, 2024

Crypto airdrops are a popular phenomenon in the cryptocurrency industry, which is responsible for bringing many new crypto users into the space. Attracted by the possibility of making money out of the air, many novice traders have long considered airdrops as their primary method for gaining profit. 

From the projects' point of view, crypto airdrops have become a favored strategy to boost community engagement and ensure a wide distribution of tokens, hopefully leading to its adoption throughout the crypto space. However, as not all projects are equally mature and promising, the same is true for their crypto assets. Discerning one from another is challenging, and the abundance of negative experiences leads to a noticeable decrease in the interest of users looking for airdrops. This guide explores key tips that might be helpful when identifying which projects have a greater potential for sustained growth and, thus, are worth supporting. 

Airdrops & Their Types

The concept of airdrops is reflected in its name: various crypto projects choose to distribute small amounts of their crypto tokens among individuals for free to grow the following and ensure a smoother start to the token's existence on the market. To partake in an airdrop, one typically needs to register through a Google form, a Telegram bot, or directly on a project's website. 

Additionally, an airdrop campaign will often provide an opportunity to get more tokens by referring others through a unique link. Such referral systems incentivize sharing the airdrop with as many people as possible, assisting in growing an even bigger audience of token holders and, possibly, users. 

Another way to distribute new tokens is to airdrop them directly into users' wallets. This airdrop subtype is often called a holder or exclusive airdrop and is used by developers to show gratitude to their projects' loyal users. Sometimes, they airdrop original tokens, and sometimes, they can airdrop another type, for example, promoting new developments. In either case, no action is required from a receiver. 

Evaluating Projects

Careful evaluation of a project is essential before participating in an airdrop. Review all available information, including the whitepaper, the website, and social media channels associated with the project. This way, you can better understand the project's purpose and the team's motivation for its creation, which can help you determine the project's ability to find its place on the market and achieve success.

First, take time to scrutinize the project's tokenomics. Tokenomics refers to the economic model of the token and includes factors such as token supply, distribution plans, and vesting schedules for team members. Even if you cannot fully comprehend this information, the presence of tokenomics and fair and transparent token distribution is already a good sign, indicating the seriousness and inclusivity of the project. 

The second critical factor to consider is the team behind the project. Airdrops from projects with transparent and respectable teams are more likely to succeed. Therefore, it is a good idea to study the experience of the project's founders and developers to gauge their expertise and commitment levels. Look for signs of transparency, such as team members sharing their real names and professional histories.

Next, assessing the level of community support and engagement surrounding the project is equally important. Projects with active and engaged communities tend to have more successful airdrops. So, join the project's social media channels, Discord groups, or dedicated forums to gauge the level of community support and stay up-to-date on relevant news. In addition, evaluate how developers interact with the community. Projects that value and respond to community feedback are far more likely to have sustainable growth. 

Another critical factor to examine is security. Projects prioritizing audits demonstrate a solid commitment to user safety, which is a good sign. Therefore, look for projects that have undergone thorough security audits conducted by reputable firms. 

Finally, take a look at the project's development progress. Check the GitHub repository or other development channels to assess the project's maturity. Active and transparent development is a positive indicator of long-term viability. By paying attention to these factors, you can make more informed decisions and decrease time spent supporting unserious projects.

Red Flags & Scams

When looking for investment opportunities, be cautious and avoid falling for unrealistic promises and aggressive marketing tactics. Sustainable projects focus on delivering value and have a more realistic approach to generating returns. Additionally, it is advisable to be cautious of projects whose team members choose to remain anonymous. Transparent projects with identifiable team members tend to be more accountable and reliable as they are more likely to be held responsible for their actions.

Furthermore, one needs to be cautious when exploring the world of airdrops, as there are plenty of fraudsters. Among the most widespread scams are dump airdrops, stealing scams, and phishing scams.

In a dump airdrop, the main objective is to generate short-term excitement about a token. This encourages people to buy the token when it becomes available on DEXes or CEXes. The developers then sell (dump) all their tokens as soon as possible, making a considerable profit. After they have sold as many tokens as possible, they disappear, and the project becomes inactive. Identifying a dump airdrop can be challenging, but one effective method is carefully examining the project's website and docs. Usually, the individuals responsible for a dump airdrop will not invest significant effort into either of these aspects.

Scams aimed at stealing either your funds or information are also common. In the first case, these fake airdrops are designed to deceive you into giving away information needed to access your funds. While legitimate airdrops only ask for your wallet's public address, individuals behind fake ones ask for your private keys, trying to pocket your funds. Inexperienced users unfamiliar with how crypto wallets work can easily fall for these scams. 

Stealing scams can also focus on acquiring personal information, which could be used for future phishing attempts or sold to third parties. While not as dangerous as private key scams, they can still pose significant risks. 

Lastly, a common tactic fraudsters use is phishing scams, which trick individuals into divulging sensitive information by posing as legitimate entities. To avoid falling prey to such scams, always verify announcements on official channels and refrain from clicking on suspicious links. 

Final Thoughts

Exploring the latest crypto projects, supporting their growth, and profiting from their success are thrilling aspects that attract many crypto enthusiasts to partake in crypto airdrops. By being cautious and adhering to the suggestions mentioned above, you can maximize the positive outcome of these opportunities and provide support to projects that have legitimate potential. As the DeFi industry continues to mature, informed and discerning participants play a crucial role in shaping the future of blockchain technology, and airdrops can still be an effective tool in contributing to the growth of a dynamic and sustainable crypto ecosystem.

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